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GSNN
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You have the dream. They have the money. But do you have what it takes to swim with five of the business world's elite sharks? Recaps by Chico Alexander, GSNN
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Episode 2.1 Dreams... You have them. Five venture capitalists want to fund them. But you're going to have to prove to them that you are worth their time AND money. Time to reopen the Tank... OWNER: Michael & Babz Barnett;
Richmond, VA Their creation is a magical place where different kids can bond and learn together. It's a children's enrichment center specializing in gym, art, and music. There are currently 10 Romp'n'Rolls from Pennsylvania to Puerto Rico, and they've taken in $4 million in revenue over five years. Their goal: a Romp'n'Roll in every community around the world. Their tagline: "Nurture the genius, unleash the goofball." Funny, that's GSNN's tagline as well. Kevin H want to know how different this is from Gymboree. Babz: "Gymboree, the cassette player. Romp'n'Roll... the MP3 player." Last year, they took in $1.2 million. Babz also says that "mommy marketing" is more powerful than print and TV, so much that 1 percent is only spent on marketing. Kevin O is impressed, but he's not impressed with the business model. He's out. Same with Daymond. This isn't him. Harrington's out as well. Barbara can't bear to see another failure (she used to take her 3-year-old to Gymboree in Manhattan), so she's out. Robert's still in, but all Babz's energies are concentrated on the other Sharks. Are they going to stay focused enough to maintain this business to earn the Sharks' backing? Robert's in, but he wants 51%. The Barnetts talk it over, saying that they will never give up more than 50%. Meanwhile, O'Leary offers to go in with him for control, saying that he's knowledgeable of the education business. The Barnetts counter with 20%. If it's anything I've learned from watching this show... You never argue with the people who have money and/or expertise. The Sharks have both. And as of right now... the Barnetts have NONE. Next... REVISIT: Stress Free Kids Lori Lite made a $50,000 deal with Barbara back in season 1. Some time later, we're at a Borders where she's doing a signing and a reading. Lite's titles have been picked up by the chain, and will be in their stores nationwide. OWNER: Marix Stone & Dr. Nancy Tanchel,
parts unknown Stone has made a legally-mandated safety helmet and made it stronger, safer, and actually pretty darn appealing with three-dimensional graphics. And... that's as far as he goes in his pitch. Only millions of people watching, take your time. They are bringing in $300,000 for the helmets this year, but they want to get into the mass production. They own the patent for the 3D helmets. This is an unbelievable assets. Profit margin is over 50%. Harrington is out. He can't write a check for half a mill on potential. Same with O'Leary. Barbara says that this isn't her cup of tea. Daymond says that they have $300,000 in sales... yet their product is valued at $2.5 million. That's crazy talk. BUT Daymond offers the money for 50/50 for the license. Robert was going to offer the money for 75%, so he's out. ACCEPTED: Daymond's offer of $500K for a 50% stake. OWNER: Alfonzo Dowe, Sr.; New Jersey The Twister is a portable golf ball cleaner. He demonstrates it in front of the panel, and it works perfectly. He's sold a couple thou worth of them. But he needs business know-how... He is a police officer who's marketing this for the loved ones in a golfer's life. Kevin H... is THE golfer. So he's out. Barbara says they'll buy a lot of them, but she doesn't like golf, so she's out. Robert gets out as well. The rest of the Sharks follow suit. But Robert wants to buy one anyway. OWNER: Dorene Humason; Folsom, CA Dorene has spent her years as a buyer and a food representative. She has created what she believes is a great product for the cook in our lives. The product itself... a Chinese salad dressing and seasoning mix packet. It's in 1300 stores already. Robert says that there are millions of packets just like hers. It will all come down to market share. Her sales have come up $78,000 so far, but she's had a bit of a problem with the packaging. The first packaging was offensive... it had a Japanese prostitute. The focus is on the company, but the product is the selling bit. That confuses the Sharks, so they're going to bow out one at a time, leaving Barbara, who's scared to death of the food category. Barbara wants 40% of her business, but Dorene has to commit to the dry salad dressing first. Dorene counters with 35%. DEAL. ACCEPTED: Dorene's counteroffer to Barbara for $50K for a 35% stake. Last subject... OWNER: Andy Sperry; Franklin, TN Andy's product is like "Netflix for anyone who's ever used a computer printer." What happens is that customers send Inkflip empty cartridges, they fill them and send them back. That way, there's always a spare. It's basically Cartridge World. Inkflip has $10,000 in revenue over its six-month lifespan. There's one killer question: what is the cost of acquiring one customer. Andy has absolutely no idea. The Sharks are out on the basis of that. So in the end, we've learned that if you're going to see the Sharks, you better have done your homework. To see this episode in its entirety, go to www.abc.com/primetime/sharktank. |
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